Telematics
Technology that captures driving data, through an in-car device or a smartphone, and feeds behavior-based pricing.
Progressive rolled Snapshot out across the United States in 2008: a plug-in device measures braking, time of day and mileage, and the rate follows what the driver does rather than what the driver declares. Telematics means the devices that measure driving in real time. Originally that was a box installed in the vehicle; today it is most often the smartphone's sensors, accelerometer, gyroscope and GPS. They record acceleration, braking, cornering, speed, time of travel and distracted driving, and roll them up into a driving score that adjusts the premium. Telematics is the technical basis of usage-based insurance. It fits most naturally in commercial fleet insurance, where monitoring falls under the employer's authority to manage its staff. With individual drivers, on the other hand, it raises sharp questions of consent, privacy and resale of data to brokers.
Textbook case: a company fits its vehicles with telematics devices and gets a premium reduction of around 20%, in exchange for continuous monitoring of how its employees drive.
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